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tv   Mad Money  NBC  March 3, 2016 3:00am-3:56am EST

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"mad money" starts now. hey, i'm cramer! welcome to "mad money," welcome to cramerica. other people want to make friends, i'm just trying to make money. my job the not just to entertain you but to teach and coach you, tweet mejimcramer. i don't know about you, but it feels better, doesn't it? is it actually better? pretty good consolidation following yesterday's big run. dow inched up, nasdaq climbed. that's why we have our checklist, the one i created back in mid-january when it was ugly to help determine if this market has what it needs to give us a sustainable rally. not a tradable one but a sustainable one. we said the fed has to give us clarity about where it stands on rate hike and the last week we've had two, the new york fed downgraded their views of the economy will be cautious about the rushing to rate hike
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as long as we don't get a smoking hot employment number on friday. this is good enough for government work. you know what i'm doing? i'm checking it off. two, we need some resolution to the political uncertainty. the last time we went down the list, we had no certainty in either party. after last night, barring some extreme, it's hillary versus the donald. now we can create portfolios for either eventuality. maybe ensuring our portfolio for some of them. i say check! third, we need china to get better. it's gotten worse but the frame index has been creeping up slowly and there's be a big chinese parliament meeting where we expect aggressive stimulus. meanwhile, the decline in the shanghai stock market hasn't hurt our markets. that's a big change. i'll call it a half check. that's why we have half checks. maybe it can be a full check on monday if the parliament does the right thing.
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bottom? copper is breaking out. i'm feeling more confident this group may be going down. not necessarily from increased demand which is what we like but from reduced supply so what we're going to do is give it a check mark. box number five, oil needs to stop going down. the relentless slide must end. hmm. we had a big inventory increase today and it didn't get hammered, it went higher. new pattern. it looks like oil stocks have stabilized. i'm feeling good crude may have bottom. i don't expect a big rally because oil will keep coming to the market but the down side seems to be quantified so i am saying check. six, we need to see some improvement in the geopolitical scene. north korea started this, north
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there's a san francisco in syria, the relative moderates are winning in iran, the "times" says that, who knows. not bad for a couple week's work. that's a definite check. item seven, we need the zombie companies to be put to death. here's something i didn't expect, many zombies have gone up enough to get more liquid. we've seen equity offering after equity offering for the oil companies that have saved their balance sheets and made money for investors like yesterday's giant marathon oil deal giveaway. these offerings in turn have void it had stocks of the banks that loan those companies money that we were worried about. there were plenty of smaller oil firms that will go belly up but they're smaller and coal companies will go but i think there's enough equity money to keep a ton of dying companies alive until oil goes higher.
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let's give it a check. eight, we need relief from the super freaking strong dollar. super freaking! this was the one thing that had been going right when we did the review a few weeks ago but the euro has gotten weak again and while some emerging market currencies have gotten stronger -- indonesia -- there's no check in sight for this very important box. so no check. next, item nine, we need more urgers and acquisitions, eureka, we have some. we have johnson controls and tyco and a chinese company buying the genetically modified sea company then we had the failed deal when honeywell was rebuffed by united technologies. i want to say things are getting better and that's why i'll give this a half check.
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no check whatsoever. box number 11, we were afraid of peaks but we've seen resurgence in the home builder stocks, perhaps because interest rates have come down. to national home builder tr pointe group. we had a split decision on autos, gm faltering and aerospace remains strong according to united technologies and honeywell. stock of boeing because they have issues involving accounting and when i see that i say sell, sell, sell. i think apple stock may have put in a bottom because the iphone 7 beckons in the second half of the year. i say this one deserves a half check. 12, we needed to see more negativity. 13 days ago we had a level of negativity i hadn't seen in ages, what many thought would be a credit crunch, oil threatened to take down banks, we heard
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lending. that panic dissipated. we've seen peak fear and negativity for the cycle and that check is standing. item 13, we need more sector leadership besides fang, my acronym for facebook, amazon, netflix and google. we've witnessed cloud stock which is have been decimated by terrible performs like linked in and tableau software come back to life. superior quarter, sales force and work day leading the charge. we've seen leadership? the cyclicals. we lack the drugs in the biotechs, the banks are a stalled but we've seen retailers and restaurants bottom so we're going to keep that check up. finally we wanted to see our favorite companies do better because of lower energy prices. other than a small handful of companies, this just had to happen. we've experienced the down side of lower oil but very little of the upside. i don't know, clorox gave us
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maybe i stick with the check. no. no. you know what? let's downgrade that to a half check. so let's put it all together. we've had 14 boxes that needed to be checked before we could feel safe about holding on to stocks when they rally and buying more aggressively when they pull back as opposed to keeping our powder dry and selling when it goes up. by my account we have a lot of boxes checked, a couple is still unchecked but i think we have enough to declare that we are in better shape than we have been since the year began. what does that mean? okay, here's my bottom line. you'll never have all the planets align at once. you won't get dollar and this and that. we would love -- you know, but we can't. we can't do that. we have to be mindful that we have more checked than we don't and that makes me say that you
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you can buy the dips more aggressively and the rips, you know what? i wouldn't be so quick to sell them now. because this time they may be the real deal. let's go to brian in illinois. brian. >> caller: hey, jim, love the show, thank you for having me. >> you're welcome. >> caller: my question is where do you see the stock value going in the short run and long run for railroad companies such as union pacific, bnsf and csx with regard to the devalue in oil in the past year. >> that's crude by rail. we know from rbn that crude by rail has seen its day. i thought it was interesting that we got a story that chesapeake might have gotten a bid -- i mean csx may have gotten a bit. chesapeake is on my mind, sadly, we'll talk about that later. i like the rails, i think csx represents value. we're back to our handy dandy checklist and i think there's enough evidence for me to say dips can be bought and you don't need to sell the rips because they can be the real deal. on "mad money," a crazy few
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speaking to the ceo. it's the first time since he decided to abandon his bid for united technologies. i'm calling it an exclusive. can the company behind ihop keep serving up the sweet stuff? and investing is like buying a house. it's all all location, location and location. find out if tr pointe is the right place for your cash to call home.
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it's been a couple of crazy weeks for honeywell. the terrific diversified industrial makes everything from aerospace components to climate control systems, security equipment, special materials, turbochargers, refining catalysts. on monday of last week, my squawk on the street partner david faber broke the news that honeywell held merger talks with united technologies. huge company. but they ultimately rebuffed their advance.
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deal and caused its stock to rally. honeywell held its annual investor conversation where the company reaffirmed its full year guidance. i caught up with dave cote before the meeting. take a look. day, you've never minced words in all the years we've known each other. first page of your gigantic meeting is "honeywell united technologies combination." it made me think there's no way this could be over if this is the first page of your report. >> well, i view it differently. i just know it's on a lot of people's minds and just because i've said, okay, it's done, we're disengaging that there's still a bunch of people out there that want to know, well, wait a minute, tell us a little more why and they want more color commentary. >> give us the timeline because this -- it's very clear you did not go to greg hayes, the ceo,
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say "you know what, we've got to revive the talks started by you guys because this is a great idea." that was not the narrative. >> no, that's correct. in fact, this actually -- the more recent pass started about four years, a i want to say. 2011/2012 when louis approached me and at the time we didn't do it. then greg raised it with me in a meeting. he asked me if he could speak to me afterwards. we did. this was april of '15, somewhere thereabouts. he made a proposal, we made a counterproposal in september/october, they responded vehemently they wanted nothing to do with it and we revived two weeks ago. >> now, when he came and approached you, he must have given you some surety that he looked at boeing, he looked at airbus, he looked at e.u., all the different reservations and told you they were solvable or he wouldn't have approached you. >> as you might imagine, for me
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dynamic during this process. when they're approaching us, none of these things are a big deal, antitrust not a big deal, customer issue not a big deal. then suddenly when the approach goes the other way it's like "whoa." >> the history of this is that at one point they were -- their market cap was almost double yours. by the time that it got to the most recent, your market cap was bigger. influential in terms of who should run the company given the fact that your company became bigger market cap. >> yeah, i'd say that has an impact but i'm trying not to sound too, say, egocentric or self-aggrandizing about it. at the end of the day, if you're putting together two companies that big -- and i also thought if you did that you could get not just synergy which is you've heard us talking about -- >> which you were talking about. >> you could end up with something that gave you a nice core growth portfolio. and it seemed to me that just reputation wise investors would
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doing that. and i said i would be willing to do that even though i'm 63 and a half. >> you would be the ceo. >> yeah. >> now, there's an important slide in your very comprehensive presentation today. "plane supply is bid in pieces, not in total." this made it very clear that if you wanted to look at this thing on a case-by-case, whether boeing or airbus could complain, you don't bid together. it wasn't like you take the cockpit, you've got to take the engines. not like that. >> exactly. a plane is bid in a bunch of different pieces. and there's -- if you look at the chart, there's a lot of competition in every one of those pieces and as you probably saw at the top upper right, there's a red section where overlaps were identified where there is no overlap. so that's more like -- i use the example exxonmobil. it's more like glaxosmithkline. you talk about that it's kind of like j.p. morgan bank one. but those are more fragmented
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>> well, that was also an attempt to assuage investor concerns about has a deal this big ever been done and been successful? and the point is, yeah, actually, maybe not in industrials but in a bunch of other areas it has. >> 42 in cash is what we've been hearing, $108. but you hear about your credit, you've always cared about your credit rating. could you go to $118 without a problem? >> if it's done with stock of course you can. certainly we could pay it. i don't want to, though, because -- >> right, but to get it done given the incredible cost synergies it could work. >> perhaps. but i can say at $108 this is already an incredible deal, or i should say was an incredible deal because utx share owners would have gotten .6 shares of honeywell, a better growth portfolio with what's occurring at honeywell, $3.5 billion in synergies.
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multiple. there was a lot of value there already but if they don't want to do it, they don't want to do it. >> how many times did they meet with you even as they now say they didn't have interest. mr. hayes said to me that it would have been irresponsible deal. how many times did he meet with you on this irresponsible deal? >> well, on the first pass, if we go back to april, it was like three or four times. and if we go back -- >> did he ever mention it was irresponsible? >> no. [ laughter ] no, it was a good idea back then. >> okay. when did it become irresponsible? >> that's very funny. >> when you became ceo? there was a tipping point of irresponsibility and i'm trying to nail it down, dave. >> i think that tipping point was when we said, tell you what, here's the offer we're willing to make. and that was back in september of last year. and i just recently made an approach to so would have been like two weeks, a i called him on a tuesday.
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his chairman. >> last -- this is like two fridays ago? >> two fridays ago, i want to say like the 19th or something like that. and monday it became public and i called growing say i have no idea how the heck this happened. >> but it did get ugly and it seemed like it was about to get uglier. is that a reason why the deal was dropped? have somebody who negotiates on the other side. if you don't -- and it's very clear they want -- i think it was on your show, wasn't it, no like no way, no how. >> yes, jim it's never gonna happen, to give the quote. and never gonna happen means there was no way that you were going to go hostile. >> well, i've always kind of viewed it as -- i want to do stuff that's the smart for share owners. going hostile i don't think makes sense and i was clear from the beginning with investors that i won't do that. both sets of share owners can make money here but if they don't want to do it, they don't want to do it. we have plenty of other opportunities.
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story today. >> we're going to spend a lot of time on that. >> for anybody who's concerned that, gee, there's problems at honeywell, i would say okay, with time -- and they say, gee, that's another good quarter and another good quarter. >> as you said on the call, after 14 years when are they going to believe? you do not mince words. you have a btw share sale question. i was saying to my colleague, i've got to ask about why you sold half the stock. you bring it up. why did you sell half? >> sell what? >> why did you sell so much stock? >> i thought you said sell half. i didn't sell half. >> well, people said you were, there was a percentage, some of the press reports said that. that's not true. you sold some of your stock. why? >> well, i always knew this, i have to say i've really been impressed with the press' ability to take little things and kind of blow them out of proportion. it's quite impressive. so this is an example. i have sold let's say in that
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holdings of honeywell, less than 10%. i own over 60 times my salary in shares today. i hold all my options for the full ten-year term. i exercise in the tenth year. then i require that we have to hold the shares for a year so i first sold shares i want to say last february. and this because the -- when it comes up -- >> i know that's -- >> when the year comes up that's when i sold. so i did the same thing this year. it was all approved by counsel and by the way -- >> there's a pattern in it. >> well, it's a new pattern because i got through the ten years and the 11th year and, by the way, this has been a great strategy. >> this combination, i want to go back to this, had nothing do with what i thought was an unbelievable 2015 set up for 2016 which you say is doing better and a 2017 that makes me feel like why bother with this?
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are so -- you've got the turbo really growing, you've solved the problems, whatever, with oil and gas, you've got aerospace that's terrific. why even waste your time with this, dave? so much is going right at honeywell? >> it is all going right but just because it is it doesn't mean there's not the possibility to do more and add greater value for share owners. so this is one where we look at it saying hey, we've got a great thing going here but, wow, if we could make this happen that would be great for everyone. >> here's a very hot engine, so to speak. they were a $100 billion company, they did lose a lot of market cap. is this taking advantage of what could be a gap year? 2017 could be a much better year for united technologies, too. >> well, i think it was on your show that greg said this is not about this year or 2017 for utx, this is about 2018 and beyond. >> and i totally disagree with him because it's clear he's making a 2017 bid that he will talk about. but that's all right. that's dave cote from honeywell.
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more with dave. >> coming up -- >> you are always straightforward when you get something wrong. >> don't miss what the ceo of honeywell has to say next. emergency roadside service and how it's available 24/7 and then our car overheated... what are the chances? can you send a tow truck please? uh, the location? you're not going to believe this but it's um... it's in a tree. i wish i was joking, mate,
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>> yeah, i know, a guest on mad money said they felt nest was hot but there are quality issues and that's not something that's happening necessarily at honeywell. you did not get to talk on your conference call about elster. $5 billion acquisition that dove tails with so many of your products. you have a month. how is elster doing versus, say, six months ago? >> well, i'm psyched about this one. i really -- this one will be great. there's a couple of themes, a couple of macrotrends that will be important. one is metering of all kinds is becoming more and more important. especially as you look at high-growth regions where there's so much theft of whether it's gas, water, electricity in particular. and they want to understand what's going on. another one is this ability to variable price. a third is the ability to start connecting all these devices so that a utility with the software that we have as part of elster
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and improve their own performance. the fourth one is just the whole focus on gas. and this is between the gas meters that we have on industrial basis and residential basis. gas is going to become more and more important because there's an awful lot of it. >> i want to dove tail what you were talking about with that on the conference call where jci merged with tyco and it sounded subsequently that the building controls business for honeywell may not be integral but that sounded like elster to me. >> i think this was a rumor that was print -- >> there's a lot of rumors get printed these days. >> like i said, i'm not -- >> do they check them off with someone at your organization is it just a great thing to throw out? maybe the facts shouldn't get in the way of the story. >> [ laughter ] that's very good. >> thank you. >> i think on that one we said "no comment." >> oh, okay.
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>> it's integral. >> that's a big deal for us. >> all right. now turbo. i thought that turbo was played out. i was shocked to see in your most recent presentations, turbo is early still. >> oh, yeah. >> explain why that's early and what it does. >> i'd say there's two reasons that i would say this is still early stages. if you look at what a turbo does, kind of simply, it allows a v-6 engine to perform like a v-8 engine, so in terms of power. so you get v-8 power, v-6 energy uses. >> everybody wants that. >> if we look at turbo penetration, turbos are penetrated like 25 or 30% -- >> i was shocked it was that low. i don't understand why it's that low. >> it will take ten to 15 years for it to get to 90%. it probably ought to go to 100%. if you just keep looking at the
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it's cafe or e.u. five, six, et cetera, that will keep happening because as the world becomes more wealthy and you get more cars people will want to say how do you use less energy to do this? electric cars are interesting but it's not going to take 100% of the stock that's out there, it's just not. so this is going to be -- turbos are going to be great industry for a long time and we're advantaged because a turbo is really just an offshoot of a jet engine. we are the only turbo manufacturer that has a jet engine business. >> now, you are always straightforward when you get something wrong. in oil and gas, you admitted that the decline may not be that impactful and that that was wrong. why is that wrong given what we see and the crisis now of oil and gas and why do you think by the end of the year this will be almost neutralized? >> i actually parsed it into two comments that i felt i made. the first one was i kept saying
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decline wasn't going to affect us as much because we were more mid-and downstream. this that was going to put more money in consumers' pockets which meant more spending, better economy, more pull -- >> you also made the point there will be plants built because of this which has been already good for you. >> well, and it was all geared off of that increased demand because consumers would spend. well, consumers didn't spend so i had that one wrong. so it did hit us more than i expected. the point that i'm trying to make with investors where i was right and i want to make sure they don't miss is you've heard me say before that i don't want any one thing to be so big that, yeah, okay, it's making the company. by the same token, when it doesn't work it kills the can company. and i think we were able to show with our performance last year that despite that oil and gas problem our earnings were up 10%. >> you couldn't see it. >> at a time when it significantly outperformed the entire industrial sector. we say okay, it's one of the things we manage. sucks when it's happening but it's one thing you manage.
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underestimated by almost every semiconductor and tech company. why is that? it seems like airplane connectivity may be the big story for 2017 for honeywell. >> well, you're going to see a lot more about that in our exhibit. and the big thing that we've been able to do for inmarsat for k-a band. you've got h-band, k-u, k-a. by the time you get to k-a you end up with something that's 5% of the cost and 100% faster. so with this k-a being jet wave, you can download a movie while you're in the air in two minutes. >> can you download the super bowl that i didn't see. >> you didn't watch the super bowl? >> i was on the plane! go go didn't have it. that's a crime. will it end? >> yeah, that's more than a misdemeanor. [ laughter ] >> well, i think people will want to know that. dave cote, chairman and ceo of honeywell, always great to talk
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if there's one thing you need to understand about retailers and especially restaurants it's that these days more than anything else the consumer wants value. just witness the recent success of din, the parent of applebees and ihop.
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plenty of good food at relatively inexpensive prices. last week, the company reported that while ihop was incredibly strong, management lamented the performance of applebee's. can applebee's turn. can ihop fight off the all daybreak fast initiatives that mcdonald's and other companies are fighting for share? let's check in with julius stewart from dine equity. ms. stewart, welcome back to "mad money." >> thank you, i love being on "mad money." >> first we know we got national pancake day coming up and the ihop numbers were extraordinary to me it looked like even though mcdonald's has gotten aggressive, it didn't hurt sales. >> no, we had a record year. we had the highest comp sales increase we've had in ten years and next week we're excited about celebrating national pancake day. >> you've been using social
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>> absolutely. >> this is our 11th year. we have raised $20 million for children's miracle network and other local charities but we're hoping to raise $3.5 million next tuesday on national pancake day. >> congratulations. i wish all companies were that responsible. i have a bone to pick with you. i thought you were too down beat on your call. you spent a tremendous amount of time beating yourself up about applebee's. i didn't think it was all that bad but explain why you found it unacceptable. >> we had sales growth and it's not enough for what we want to be and do and we think we can reinvigorate the brandt and have it be more successful with an incredible sales growth. so we're focused on some secretive things we're doing but it will change the story at applebee's and we think in the
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real difference on what consumers see. so we're maniacally focused on doing that while keeping up the great momentum we've had at ihop. >> i know analysts try to get you to say what are you going to do at applebee's and i know there are competitive issues but let me ask you. i like applebee's. i like the food. i like to have a beer there. i've never regarded it as being anything other than a pretty good place to go. is it just that there's too many other pretty good places to go right now? >> i think we just need to be bolder in the way we talk about applebee's and the things we do at applebee's. we've been very successful. we created a wonderful foundational plan the last couple of years but we need to really step out from all the other casual diners and grill and bar and really be unique in our story and we think what we're doing this year secret-secret wink-wink nod-nod will make a difference. >> do you envision applebee's -- will we recognize it from either
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that could be going on in both parts. >> i would say that the large majority of what you'll notice is inside. i think you'll really see a difference. but you might even begin to notice from the outside as well. >> that would be very new. new you've always been a very good steward of your capital for shareholders. big dividend boost buyback. seems like you got very aggressive with buyback. more room for that or did stock get too cheap when it fell that was a bad period for all restaurant chains? >> we have a huge amount of free cash flow that we'll generate this year as we always have. as you know, we've always said the large majority of that we would return to share holders in the form of a dividend. this year doesn't appear to be different.
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got a unique opportunity opportunistically we'll take advantage of that. >> one last question. pancakes aren't necessarily good for you or bad for you but i think that they are fattening for you. millennials still love them, though, right? seems like there's a whole new generation that decided they like to eat them all day. >> i've told you before, you can eat the short stack and have it be under 500 calories, you just have to have sugar-free syrup and you've got to have pride instead of real butter. >> well, there you go. i think that's fine. it's not on my cleanse, the cleanse failed, i put on five pounds as soon as it was over. thank you so much for coming on. stop beating yourself up, ihop is king! i think this stock is inexpensive because of one division that will turn around because that's the way julia does it. stick with ihop, stick with dine equity, stick with cramer. check this out, bro. what's that, broheim? i switched to geico and got more. more savings on car insurance?
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it is time! time for the lightning round! will you ready? time for the lightning round. let's start with john in california. john. >> caller: yes, mr. cramer, could you please comment on palo alto networks? >> the quarter was really good, the stock had a very big move, it's now consolidating, i think it's ready to go higher. ronnie in massachusetts. ronnie. >> caller: hi, jim, booyah to ya. >> booyah. >> caller: rite aid, buy sell or hold? >> walgreens was in big
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you'll make money forthey walk away there are other buyers. i like rite aid but i prefer walgreens. that's what i own for the trust. let's go to gene in tennessee. gene? >> caller: booyah, jim. >> too cheap. what goes around comes around. john in new jersey, john? >> caller: a summit booyah to you, jim. the question i have pertains to a small cap bio tech company that received approval from the fda for a product for the treatment of [ muted ]. >> i don't know. i didn't read the acceptance of it being that positive at all and they had to do a label change. no, i didn't read it the way you do did. i do not think it was that positive. doris in florida. doris?
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how are you? >> what's happening? >> caller: what's happening? that's what i'd like to know. what's happening with intercept. >> intercept. small speculative biotechs have still not come back. they just haven't and i'm not going to go there yet until i see some pulse, and i don't. and that, ladies and gentlemen, is the conclusion of the lightning round! [ buzzer sounding ] >> the lightning round is sponsored by: and pilled cardigans become pets. but it's not you, it's the laundry. protect your clothes from stretching, fading, and fuzz. ...with downy fabric conditioner... it not only softens and freshens, it helps protect clothes from the damage of the wash. so your favorite clothes stay your favorite clothes.
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the conventional wisdom on wall street leans towards the idea that the federal reserve will hold off on raising interest rates this month. does that mean home builders can get traction? let's consider tri point holdings. that's tph. this is a small home builder with a stock that's been a punching bag. down 34% from its highs last june. a big part of that decline frankly just came from the fed tightening. now tr pointe reported last friday and the company delivered a six cent earnings beat higher-than-expected revenues. good clip. more important new homers were up 5%. new home deliveries increased by 30%. average selling price being 5% higher than a year ago and the exposure didn't keep them back. plus management gave bullish guidance for 2016. if the fed is on hold mortgage rates will stay low and that could cause investors to flap back to a stock like this one. a lot of these stocks are doing better now. let's take a closer look with the ceo of tri pointe holdings.
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it, thank you. >> we talk about sustainability and how younger people like it. we go to see ceos and ask is your company sustainable because we know you can't get millennials anymore unless you say that. you figure this out for home building. >> yeah, if you look at the home building industry and you look -- go back to 1991 to 2016 starts and permits were on a 15-year upslope. what drove that? baby boomers. so today, 2016, take that same trajectory and put the millennials behind it. those are 20 to 35-year-olds. i have them at my house. so what we've down at tri pointe is we've done a lot of research. we introduced two homes at the international building show in las vegas this past january and it addresses the millennial needs from a more contemporary bold design, from a walkability,
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millennial not wanting to live in suburbia. these homes are 20 minutes from the strip in las vegas and they've responded well to the consumer. >> in terms of where you are, you go over the list of, you know, you're in seattle, performance is strong, arizona, strong, really good. you're in colorado it's really good. houston not as bad as you thought. so it looks like -- vegas is good. so it's really good and yet the stock seems to have a hard time going higher. don't you think that's because the federal reserve is always one step ahead of raising rates and that's what people rory about? >> i think the interest rate change dampened the home building stock. >> the fourth quarter, you said yourself it wasn't perfect. >> but in look at tr pointe group, we went public three years ago. when i was on your show 12 months ago we were into a $2.8 billion merger with warehouser real estate company and there was a lot of execution and integration risk questions about
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we increased deliveries 31%. we delivered at the high end of the range at $1.27. so we've shown to the street but we've kind of glided under the radar screen a little bit. what my job is to get back out there and continue to back out there and tell the story and let investors know the execution and the integration risk is done. we're blocking and tackling now. >> here's the problem i have. i look at the value of the market cap, it's $1.7 billion. i read through what you have in your real estate portfolio. and i think that if you were to -- if tr ppointe were to shut down and sell its real estate it would be worth more than $1.7 billion. >> it would. because we trade at a book value and under that reverse trust warehouser -- >> the transaction. >> the transaction we did it
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because of that, there's imputed value in our real estate over the next several years and as we look at 2016 to 2018 we're forecasting delivery growth of 25% to 33%. and it's because of this land, this embedded value we have in the land. and earnings from the housing will grow in double digit fashion between 2016 and 2018. so my job is to keep executing. that's our game plan. >> two things i have to cover because they worry me, i know you have houston exposure and you mentioned a couple times it costs more, labor. where are we? >> let's talk about houston. one of the things about houston is our business model in houston. that concerns the investor base. we have an option only strategy which that means, jim, we reset the land price every time we take lots down. our group in houston builds under trend maker. they haven't lost a dime, never lost a nickel. >> at 6% total. >> we have $60 million of land on a $2.5 billion balance sheet.
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said maybe some of those oil guys would move over. that can happen? >> we're starting to see it this year. we didn't see it last year. the labor markets will continue to improve as building permits and starts continue to increase. you're going to have a little bit of a lag effect and we'll continue to see labor improve in most our markets but it's something that's a constrain out there for the industry. >> the way i'll leave it is if you think fed rates won't hold and you want a home builder that is intrinsically cheap it's tr ppointee group. this is the ceo, doug bauer. take a look at it. it's just not priced right. i'm not kidding. especially if the fed doesn't move this year. stay with cramer. it added this other level of clean to it. it just kinda like...wiped everything clean. 6x cleaning my teeth are glowing. they are so white. 6x whitening i actually really like the 2 steps. step 1, cleans step 2, whitens. every time i use this together, it felt like... ...leaving the dentist office. crest hd. 6x cleaning, 6x whitening
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i want to say how sadden it had entire "mad money" team was to hear of aubrey mcclendon's passing. he was a visionary who, well before anyone else, believed one day this continent could be energy independent. he was right. we send our deepest condolences to his family. i'd like to say there's always a bull market somewhere and i promise to find it just for you right here on "mad money."
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tomorrow. it's thursday, march 3rd. coming up on "early today," breaking overnight, astronaut scott kelly back on u.s. soil after a year in outer space. and the republicans prepare to square off in the fox hole. court room bomb shell. a key witness caught in public watching a naked video of erin andrews. plus a brazen snatch and grab. and a wanton felon takes off a police officer at the door. and 17 labrador puppies. "early today" starts right now. good to be with you. breaking news. astronaut scott kelly is back on

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